A Rhode Island US District Judge has indefinitely blocked President Trump's freeze on federal grants and loans, arguing in his ruling that the White House had "put itself above Congress" and undermined democracy.

In a Thursday ruling, Judge John McConnell Jr., an Obama appointee - prohibited the Trump administration from freezing or otherwise impeding the disbursement of appropriated federal funds, WSJ reports.

The decision is a victory for Trump critics who say he has trampled on Congress’s authority in his effort to cut federal spending and overhaul agencies.

McConnell’s order follows a similar one issued by a different federal judge in Washington, D.C., on Feb. 25. The judge had previously issued a temporary restraining order, which on Thursday he converted into an injunction, a more permanent form of relief.

"The Executive’s categorical freeze of appropriated and obligated funds fundamentally undermines the distinct constitutional roles of each branch of our government," wrote McConnell.

"Here, the Executive put itself above Congress," he continued. "It imposed a categorical mandate on the spending of congressionally appropriated and obligated funds without regard to Congress’s authority to control spending."

McConnell's ruling came after 22 Democrat states and the District of Columbia filed a lawsuit which challenged a directive from the White House's Office of Management and Budget (OMB) directing them to pause funding while it assessed whether various government programs complied with executive orders issued by Trump which target foreign aid, DEI, and green energy projects.

While OMB then rescinded that directive, the states say that come Congressionally-approved funds were still being improperly withheld - and that the initial OMB policy rollout sowed confusion among state governments, nonprofits, and lawmakers.

McConnell issued an earlier temporary restraining order (TRO), in which he said that the administration couldn't "pause, freeze, impede, block, cancel, or terminate" its federal financial-assistance obligations to the states.

According to the judge, state governments face "significant disruption in health, education, and other public services" due to the funding freeze, and as such, "the Court finds that the public interest lies in maintaining the status quo and enjoining any categorical funding freeze."

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